This watchdog blog, by journalist Norman Oder, offers analysis, commentary, and reportage about the $4.9 billion project to build the Barclays Center arena and 16 high-rise buildings at a crucial site in Brooklyn. Dubbed Atlantic Yards by developer Forest City Ratner in 2003, it was rebranded Pacific Park Brooklyn in 2014 after the Chinese government-owned Greenland Group bought a 70% stake in 15 towers. New York State still calls it Atlantic Yards. Note: archive at right.

On 421-a, Brennan revises stance, FCR’s Bender distorts history

As Assemblyman Hakeem Jeffries and State Senator Velmanette Montgomery this week called for developer Forest City Ratner to abandon the “Atlantic Yards carve-out” in the reform of the city’s 421-a tax exemption, Assemblyman Jim Brennan, who’s been a critic of aspects of the project, seemed like the odd man out--until now.

The State Legislature has passed the revised bill but it has yet to be signed by Gov. Eliot Spitzer. Various forces, including the city administration, are calling for a revision or a veto. Brennan had told the New York Observer’s blog The Real Estate Observer that “It’s not a carve-out… The only thing that happened was that Atlantic Yards got grandfathered in.”

That seemed inaccurate, given that there’s a special provision that could only apply to Atlantic Yards, allowing the requirement of 20 percent affordable housing to be spread over the project as a whole rather than applied to each building, as the law otherwise would require, and also nudging up the income limit for Atlantic Yards affordable units. (Instead of requiring affordable housing at 60% of Area Median Income, at Atlantic Yards the limit would be 70%.)

Revised stance

Brennan told me yesterday he’s revised his stance: “I’ve been thinking through that a lot. The main bill I actually support. I’d still like to see the 421-a renegotiated, because I’d like to see Atlantic Yards back on the table. I had a factual misunderstanding... I would be happy if Spitzer vetoed the bill, because I’d like to see some rethinking of Atlantic Yards and the program. If he didn’t veto the bill, I still think there’s a lot of people who want to see a renegotiation.”

Brennan noted that the reform passed by the City Council and the Legislature (A4408 and A9293) would limit the assessed value subject to tax benefits to $650,000 of a unit's price. Atlantic Yards units would cost more and might receive only a partial exemption. However, projects providing affordable housing on-site would not be subject to the cap, and the state reform would allow Atlantic Yards to fit in that framework.

Brennan acknowledged, “Atlantic Yards may ultimately need a full 421-a tax break to be viable, and the 421-a tax break until now has been a standard subsidy. Ratner would’ve gotten it under the old system, as any developer would.” Still, he said that, “because Atlantic Yards is so complex, and has many irrationalities on the surface of it, both physical and financial," the project should be put back on the table, and 421-a is part of that renegotiation.

FCR’s Bender distorts history

In an article about 421-a in this week’s Courier-Life chain headlined “Please play fair, Mr. Ratner,” Forest City Ratner Executive VP Bruce Bender offered his comments in response to the stance taken by Jeffries and Montgomery.

The newspaper reports:“In 2005, we signed a historic affordable housing program with [the community group] ACORN that will create 2,250 units of housing for the low- and middle-income families which utilized the then existing 421-a regulations,” said Bender.

“All we are seeking to do is to preserve the ACORN agreement and build these units for the working families of Brooklyn,” he added.

Actually, if the original agreement were preserved, Forest City Ratner would have no trouble complying with the 421-a reform. The project then contained only the 4500 rental units addressed in the agreement; thus, each building would include 20% low-income units on-site and be eligible for the tax break.

However, the 1930 condos since added to the project complicate the calculations and drove the “carve-out.”

Yes, they would've been eligible when announced after the ACORN agreement was signed. But they were not part of the ACORN agreement. And reform of 421-a, if the "carve-out" is eliminated, would apply the tax breaks only to the rental buildings with on-site affordable housing.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website Matzav.com explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY.
So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:if market-rate construction is delayed, will the affordable h…

Real Estate Weekly, reporting on trends in Chinese investment in New York City, on 11/18/15 quoted Jim Costello, a senior vice president at research firm Real Capital Analytics:
“They’re typically building high-end condos, build it and sell it. Capital return is in a few years. That’s something that is ingrained in the companies that have been coming here because that’s how they’ve grown in the last 35 years. It’s always been a development game for them. So they’re just repeating their business model here,” he said.
When I read that last November, I didn't think it necessarily applied to Atlantic Yards/Pacific Park, now 70% owned (outside of the Barclays Center and B2 modular apartment tower), by the Greenland Group, owned significantly by the Shanghai government.
A majority of the buildings will be rentals, some 100% market, some 100% affordable, and several--the last several built--are supposed to be 50% market/50% subsidized. (See tentative timetable below.)Selling development …

Click on graphic to enlarge. This is post-dated to stay at the top of the blog. It will be updated as announced configurations change and buildings launch. The August 2014 tentative configurations proposed by developer Greenland Forest City Partners will change, and the project is already well behind that tentative timetable.